inr-bank-notes - INR
  • Indian Rupee (INR) falls in cautious trade
  • China GDP stagnates in Q4
  • US Dollar (USD) rises after modest falls yesterday
  • Federal President Williams to speak

The US Dollar Indian Rupee (USD/INR) exchange rate is rising on Tuesday, adding to gains from the previous session. The pair settled -0.4% lower on Monday at 81.62. At 10:00 UTC, USD/INR trades +0.22% at 81.80 and is trading in a range of 81.69 – 81.88.

The Indian Rupee is falling in risk-off trade after data showed that Chinese economic growth slowed to its second slowest pace since the 1970s. GDP slowed to 0% quarter on quarter in the fourth quarter, down from 3.9% in the third quarter. On an annual basis, growth slowed to 2.9%. This was, however, ahead of forecasts.

The data highlights the impact that the strict zero-Covid measures have had on the economy. Retail sales also slowed to -1.8% in December, and industrial production grew at a slower pace of 1.3% year on year. Although again, both these figures were ahead of forecasts.

Growth in China is expected to rebound this year. However, the data reveals the extent of the challenge that Beijing faces.

The US Dollar is rising across the board. The US Dollar Index, which measures the greenback versus a basket of major currencies, trades +0.07% at the time of writing at 102.33 after modest losses yesterday.

The US dollar traded quietly in the previous session as the US stock market was closed in observance of Martin Luther King Day, a public holiday.

The USD is edging up from a 7-month low amid a cautious market mood after China GDP data. However, the broad trend remains downwards as investors continue pricing in cooling US inflation and a less hawkish Federal Reserve.

There is no high-impacting US economic data due today. Instead, New York Fed President Williams is due to speak later and could shed light on future rate hikes.

Looking ahead US retail sales and PPI inflation data due tomorrow will be in focus.